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Judge OKs $9.3M Settlement In Ambit Class Action Lawsuit

If you’re an avid reader, or just have a really good memory, you may recall a piece we published many moons ago on the company Ambit Energy. Well, recently, a Pennsylvania federal judge greenlit a $9.3 million settlement of a proposed Ambit Energy class action lawsuit claiming an Ambit Energy Holdings LLC unit jacked up customers’ rates after luring them into switching energy providers with promises of lower prices, a suit the Third Circuit revived after it was originally dismissed. Here’s what we know about the Ambit Lawsuit.

U.S. District Judge Eduardo C. Robreno gave his preliminary approval to the settlement brokered in October between Ambit Northeast LLC and lead plaintiff Amy Silvis. The settlement was announced nine months after the Third Circuit vacated the judge’s 2016 summary judgment ruling in favor of the company.

Under the settlement agreement, Ambit will cut a check to a class of consumers who enrolled with the company’s variable energy rate plan between January 2011 and January 2014 for 15 percent of what they paid while on the plan. For a class of consumers who enrolled with the plan between January 2014 and Thursday, the reimbursement will be 2 percent, according to the order.

“Preliminary certification of the settlement class appears proper,” Judge Robreno said. “Moreover, the terms in the settlement agreement, as well as the forms of notice, appear fair, reasonable and adequate.”

A fairness hearing is scheduled for Aug. 8, according to court records.

Silvis, who launched her lawsuit in August 2014, accused Ambit of breaching its contract with customers by charging rates that didn’t meet the company’s contractual obligation to provide a competitive rate based on market factors. She alleged the company gave her a one-month “teaser” rate of 7 cents per kilowatt-hour before nearly doubling the rate.

Judge Robreno said in March 2016 that Silvis did not provide any evidence of bad faith on Ambit’s part, reasoning that the company showed that the rate increases were due to record cold temperatures in early 2014 and that financial records were provided by the company in an effort to show that Ambit was not unfairly jacking up prices.

Silvis said on appeal that the contract terms were ambiguous. She said that reading the terms of service clause and the disclosure statement together suggested that Ambit could only alter prices based on “energy and capacity markets.”

A Third Circuit panel sided with Silvis in January 2017 and sent the case back to the lower court, saying the provisions could be understood to limit Ambit’s discretion in its terms of service clause and create ambiguity over the scope of the company’s authority to change its prices.

Ambit urged the appeals court to reconsider its ruling, but the Third Circuit shot down the bid in February 2017. In July, the parties asked Judge Robreno to put the case on hold while they went to mediation, according to the judge’s order.

“We’re pleased that Judge Robreno gave his preliminary approval,” Jonathan Shub of Kohn Swift & Graf PC, who represents Silvis, told Law360 on Thursday. “We’re confident the case will be well-received by class members and Judge Robreno will give final approval.”

An Ambit representative couldn’t be immediately reached for comment Thursday.

Silvis is represented by Jonathan Shub and Kevin Laukaitis of Kohn Swift & Graf PC and Troy M. Frederick of Marcus & Mack PC.

Ambit is represented by Joanna J. Cline of Pepper Hamilton LLP and Michael W. Stockham and Meghan Nylin of Thompson & Knight LLP.

The case is Amy Silvis v. Ambit Energy LP et al., case number 2:14-cv-05005, in the U.S. District Court for the Eastern District of Pennsylvania.

This article was first seen on Law360.

Furthermore, if you are one of the customers or consultants who was hurt by this Ambit Energy class action lawsuit, Consider the Consumer would like to hear from you. We can be reached via Email at ConsiderTheConsumer@gmail.com, or you can find us on TwitterFacebook, or even connect with us directly on our website. We look forward to hearing from all of you.

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